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Chapter 5, Adjacent Services The crisp morning sun beat down on the white snow as I pulled up to Kathy's lawn and landscape in Ohio.
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Josh Kathy stood out front, pacing with a weary expression, his eyes tired yet welcoming.
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He was fresh off a 17-hour shift, plowing snow, insulting driveways.
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At first glance, his operation looked like it should be thriving.
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He was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was
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over $700,000 in revenue last year.
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Four trucks, a solid client base of big contracts.
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But within minutes, the real picture began to surface.
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And it wasn't pretty.
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An unexpected situation had blindsided Josh.
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Last year, his brother helped manage the business.
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But he stole work and equipment from the company while keeping it hidden from Josh.
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Josh hadn't seen the signs until it was too late.
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The books were a mess.
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There was no way to track expenses.
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Employees who got too close to the truth were mysteriously fired by his brother.
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There was betrayal, confusion, and loss.
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Unused and broken mowers littered the dimly lit shop space.
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By the time I got there, the fallout was staggering.
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His financial statements said he made $150,000 in profit the year before.
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But Josh had three bank accounts, all negative.
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Overdraft fees piled up daily.
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He was behind on his personal mortgage, behind on his car payments.
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He buried himself somewhere between $400,000 to $500,000 in debt and didn't know the exact number.
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His website didn't work.
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It had a security error that blocked people from accessing it.
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Someone misspelled the business name on his Google listing.
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He had zero Google reviews.
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Third-party lead agencies outranked his website online.
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His brand had no digital presence.
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When I tried to look him up, I couldn't find him.
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But the financial mess wasn't the only issue.
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Only two of his employees had driver's licenses.
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Most were unprofessional, short-term hires.
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Some didn't speak English.
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Some were working without legal authorization.
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Josh's ex-wife was getting paid cash to work for the business.
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In the past, Josh had fired her.
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She was dragging the culture of the team down.
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The only reason Josh kept her was that she had a driver's license and could transport the crews around.
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Each morning, he picked up employees from their homes.
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He drove them to job sites and balanced his schedule to keep things running smoothly.
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Those same employees complained about low pay and were inconsistent with attendance.
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Josh was being pulled under by the weight of low margin work.
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Massive commercial mowing contracts looked good on paper, but were paying about $30 to $40 an hour.
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They needed a lot of crew coordination.
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This caused frequent callbacks and made Josh depend on cheap, unreliable workers.
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He was also trying to grow the business.
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He was thinking about adding services like tree removal, chipper work, and hydro seating.
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But he was already swamped with mowing and landscaping jobs during the spring rush.
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The problem wasn't that Josh wasn't working hard.
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It's that he was working hard on the wrong things.
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He had no margin to breathe, no way to get ahead, and no clarity on where the business was bleeding out.
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We fixed the basics first.
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Longcare Web Design rebuilt his website from the ground up.
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In six weeks, Josh went from zero Google reviews to over 40.
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Customers could finally find him, and they liked what they saw.
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The real breakthrough came when we separated the profitable from the painful.
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Mowing wasn't working.
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It was low margin and had the same seasonal demand curve as landscaping.
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So we offloaded it.
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Josh began subcontracting all his commercial mowing contracts to cheaper local providers.
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Instead of making $35 an hour doing the work himself, he could make 15% to 20% margins without touching a blade of grass.
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This let him focus on his strengths.
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Project work like landscaping, hardscaping, and design installs.
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Jobs that paid $70 to $90 an hour, with fewer callbacks, with real profit.
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With crews, he could pay more.
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The labor pool he could hire from changed.
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He didn't need to keep hiring under-the-table workers to survive.
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He could attract legal laborers and pay them well.
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Then we doubled down on snow service jobs.
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Josh already had snow contracts.
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They were profitable.
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But he never capitalized on them.
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None of his crew could drive the trucks.
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We flipped that script.
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He held onto the snow removal parts of the commercial jobs and subcontracted out the mowing.
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This changed his year.
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Now, Winter was a huge profit driver, not a setback.
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He could go out and sell more snow contracts.
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Josh finally fired his ex-wife from the business.
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He didn't do it out of anger.
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He didn't need to rely on her being a driver anymore.
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He started hiring employees who were legal, professional, and had driver's licenses.
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He paid them more.
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They stayed longer.
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His customers were happier.
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His stress levels dropped.
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In six weeks, Kathy's lawn and landscape had turned a corner.
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Not because we had added more services.
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Not because we got more leads.
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We realigned the business to focus on high-margin services, snow, and landscape jobs.
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These services complement each other well and have opposite demand curves.
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This helped reduce seasonal chaos.
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This wasn't about working harder.
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It was about working smarter.
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It was about selling services that offset the demand curve of his core business.
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Landscaping and hardscaping in the summer.
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Snow removal in the winter.
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That's how you fight seasonality.
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After four weeks with the new website, Josh began receiving four to five landscaping estimates daily.
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Josh booked himself out for 26 weeks into the future with profitable project work.
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That's how Josh started to win again.
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He avoided low-profit margin mowing jobs.
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He sold snow as an adjacent service to his core landscape offerings.
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Tier 3 for Seasonitis is selling adjacent services.
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We looked into lockdown mode, which means shutting down in the off-season.
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Tier 1.
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We also focused on finding more and better jobs by advertising and upselling.
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Tier 2.
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Now, let's discuss how to sell services adjacent to your core business.
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This method is affected if your market faces severe weather changes in the off-season.
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These shifts can stop you from selling your main service.
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This was the case for Josh at Kathy's Lawn and Landscape.
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He couldn't do landscaping jobs when there was snow on the ground.
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Cure 3 is also ideal if you do not want to change your business name or brand identity.
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With the Ford F-150 example we used last chapter, upselling means upgrading from an XL to a Lariat model.
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Cross-selling means selling a trailer, bumper, or kayak rack with that truck.
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This approach appears everywhere in consumer experiences.
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When you book flights on Expedia, you'll see car rentals and hotel options at checkout.
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These have nothing to do with flying, but complement the trip.
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The fundamental idea of cross-selling is saying, you know that thing you bought?
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You might like to buy this too.
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Amazon excels at the strategy on their product pages.
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More on that soon.
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In your workbook, on page 14, we'll examine the cross-sell tree.
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But first, let's consider the upsell service funnel.
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Mowing is the top of the lawn care funnel.
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It's affordable and most customers need it.
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From there, upsell them to a property cleanup, then to recurring bed maintenance.
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Then I sell them chemical applications.
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The highest value lawn care customer receives full service maintenance.
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I sell them year-round service for all their outdoor needs.
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That's the upsell service funnel.
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As discussed in Cure 2, I am selling a better version of the original service.
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Now, let's examine the cross-cell tree.
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I provide waste removal, snow removal, and top dressing with overseeding for my mowing customers.
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They perform these services on the same property with similar equipment.
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Property cleanup customers might need pressure washing, storm debris removal, or gutter cleanouts.
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Bed maintenance clients would enjoy drip irrigation, mulch insulation, or weed barriers.
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Chemical application customers might want mosquito control, soil testing, or organic options.
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Adjacent services don't need large investments in new equipment, trucks, or branding.
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You use what you already have.
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There is no extra liability insurance or major new expenses.
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For the sake of an example, here are some pricing assumptions for a landscaping business.
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Let's say the mowing service is $50 a cut, weeding service is $30 per service, bush trimming is $300 per service, snow service is $80 per push, and moults installation is $900 per service.
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Let's calculate the financial impact of cross-selling.
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If I charge $50 per mowing, 30 times per year, and cross-sell 8 snow removal visits, I could boost revenue by 42%, from $1,500 to $2,140 each year.
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Cross-selling bush trimming 3 times per year to mowing customers increases annual revenue by 60%.
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Cross-selling snow removal and mulch insulation boosts revenue by 103%.
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This means my income doubles without any marketing costs.
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Question is, do we have a leads problem or a cross-sell problem?
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Do we lack enough offers to increase customer lifetime value?
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On page 14 of your workbook, list three cross-sell opportunities to each service in your upsell funnel.
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You can grow a business in three ways.
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I name it Aura, O-R-A, onboard, retain, ascend.
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You can onboard more customers through marketing.
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You can retain customers and raise prices over time.
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You can ascend customers by increasing their value through cross-selling.
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Home service businesses prioritize onboarding, getting new customers.
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We place some emphasis on retention, but we often neglect ascending customers into higher-ticket, higher-margin services.
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This is where the real profit lies.
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Worried about seeming too salesy?
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Remember this.
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Ford's biggest fans don't buy the cheapest models.
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They drive vehicles with all the bells and whistles.
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They upgrade to the Lariat and King Ranch editions.
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These customers stay with Ford for life.
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Their churn rate is nearly zero.
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They never leave the brand.
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These loyal customers also cross-sell themselves into light bars, custom suspensions, special tires, and other modifications.
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They customize.
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They buy more adjacent products and services.
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Your most loyal customers give you more money.
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Once you realize this, cross-selling doesn't feel pushy.
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If you cross-sell and get more money from customers, they're less likely to leave.
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They become your biggest fans.
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They leave great reviews because you solve more of their problems.
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Solving more of your customers' problems will make it less likely that they will go to a competitor.
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There is more risk for them to leave if you perform more than one service.
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Make your service stickier.
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Solve more problems and offer more services to your customers.
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Let me share a case study with a massive impact.
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This business had 200 recurring customers with an annual turn of 50%.
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Every year, they were losing half of their customers.
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Their annual customer value was $1,000.
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Multiply that by 200 recurring customers and you get $200,000 in annual value.
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Cross-selling snow removal and organic lawn care boosted their annual customer value to $2,400.
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The company went from $200,000 to $480,000 in revenue the next year.
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They didn't run advertising campaigns.
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They kept the same number of customers.
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They more than doubled revenue by increasing annual customer value from $1,000 to $2,400.
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Here's what's remarkable.
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The average customer lifespan went from two years to three years.
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That means annual churn dropped from 50% to 30%,
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The company didn't change its service quality or training.
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They provided the exact same service.
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Customers who bought snow removal and organic lawn care were less likely to leave.
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It's harder to leave once you've purchased more services from a company.
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Same as Ford.
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It's harder to leave the brand once you've bought its best truck and modified it to your liking.
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We increased annual value from $1,000 to $2,400.
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We reduced churn from 50% to 33%.
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Lifetime value for this business went from $2,000 to $7,200, more than tripling.
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The combination created a massive impact.
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How?
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We added one more service.
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We solved another problem for the customer.
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What if you don't have a retention problem?
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What if you have an ascension problem?
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We often think customers leave because of poor service.
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In reality, we're not selling them enough adjacent services.
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We don't solve enough of their problems, making it easy for them to switch to someone who will.
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When you triple lifetime value, you can afford to spend much more on customer acquisition.
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Customers become much more valuable.
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After meeting with Dr. Cashy and Alex Formozzi in Vegas, I created a cross-sell tree.
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I found that snow services increased demand during our mowing off-season.
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That became Augusta Lawn Care's adjacent service.
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It was perfect in some markets.
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Why?
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When the grass is growing, there is no snow.
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When there is snow on the ground, we can't mow.
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We sell snow surfaces using instant pricing on our website.
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Do you have a small, medium, or large driveway?
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Here's your price.
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Check out.
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Let's go.
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There are four different types of cross-selling.
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Write these down on page 15 of your workbook.
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First is bundling, offering a discounted package that includes multiple related services.
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For home services, you can offer priority scheduling instead of price discounts.
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For example, customers who buy both mowing and snow removal get first priority when it snows.
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Second, recommended products or add-ons.
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Relate to what the customer has already bought.
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If work is slow, look at declined estimates from this time last year.
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Recommend the exact same services they considered before.
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Many will accept with minimal effort.
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Consider when to propose extra services.
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Before the job, during lead collection, in meetings, or after providing estimates.
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You can recommend them on-site or after the job.
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Customer satisfaction is highest then.
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You complete the job.
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They're thrilled.
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You solve their problem.
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You have built trust.
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Offer them a solution to another problem they have.
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During the walkthrough, they're getting rave reviews.
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This is the perfect time to cross-sell another service.
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The final invoice is another opportunity to mention your next seasonal service.
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In all September and October invoices, I promote snow removal as a recommended add-on.
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Schedule post-job inspections for projects.
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When you arrive, they're still happy with your work.
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Make minor adjustments if needed, then cross-sell additional services.
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Third, another approach is using partners.
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Recommended products sold by partner companies for commission.
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For example, if you don't want to offer snow removal yourself, partner with a snow-only company.
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Sell their services to your customers to earn affiliate commissions.
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The fourth type of cross-sell is seasonal cross-selling.
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It works great for seasonal businesses.
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Send mass emails or texts to customers right before leaf season or as snow is about to fall.
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Click here to get on our snow route.
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Our goal is to avoid the business contracting seasonitis.
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We want to avoid off-seasons and fluctuations in revenue.
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But I would be crazy to think that demand is not seasonal.
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To address this, we must have season-specific offers for season-specific services.
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Create a seasonal offer for every season of the year.
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On page 14 of the workbook, match a service from your cross-sell tree with every month of the year.
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Some services might get promoted across multiple months.
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For mowing, I target March through May.
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But for the other nine months, I need different cross-sell opportunities.
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Leaf cleanups in October and November.
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Snow removal in December and February.
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And Christmas lights in November and December.
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What if Augusta Lawn Care was actually called Augusta Snow Services?
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We'd mow for seven to eight months.
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Then as snow season arrived, we'd get busy.
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This wouldn't be a time to relax or lay off employees.
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We'd run ads, hire more staff, get more trucks, and prepare for the snow season.
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Do we have a leads problem or an offer problem?
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Often, we lack enough services to stay busy year-round.
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Create more offers for each season, every quarter, every month.
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Give your team resources to execute cross-sells.
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Provide sales training to your phone answering team.
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Turn customer service calls into cross-sell opportunities.
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When someone complains about grass clippings in flowerbeds, offer bed maintenance services.
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If someone complains about a patchy lawn, offer top dressing and overseeding.
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Give your team product knowledge and sales materials.
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We give all frontline team members business cards.
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It costs $8 to get 100 of them printed off.
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Train your crew to identify specific customer needs.
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Teach them to notice overflowing gutters, weedy beds, and other cross-sell opportunities.
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Finally, share customer data and pricing information with your team.
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Some owners worry employees might steal this information.
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They might.
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But without it, they can never effectively upsell or cross-sell for you.
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We provide our crews with instant pricing door hangers.
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We give the technicians business cards.
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When they see opportunities to cross-sell, they write down the prices and share them with customers.
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Hiding information from your team might seem like protecting your business, but it actually stops cross-sell opportunities.
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You're blocking your crew from improving customer lifetime value on your behalf.
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Use software to encourage your team to recommend products based on what customers have bought before.
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If a customer buys fall cleanups each year, offer them spring cleanups or regular weeding services.
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Sell them on a recurring maintenance plan.
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In a test with Copilot CRM, we found that turning on the cross-sell feature boosted average revenue by 29%.
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This feature allows employees to send text messages or emails to customers about extra services while they are on site.
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Make it seamless for your crew to sell more services.
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Incentivize them and watch your business grow.
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Let's examine some cross-selling techniques from online retail stores.
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They excel at this.
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First is the price drop alert, a time-bound discount.
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This weekend only, buy one t-shirt, get one free.
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For home services, send a mass text.
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We're accepting new snow customers.
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For the next 24 hours, get your first visit 50% off.
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Post-purchase recommendations work well in retail.
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After you buy a suit, the store sends you recommended ties that match the outfit.
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For home services, after customers accept an estimate, the thank you page can suggest extra services.
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They have said yes to your proposal.
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Their payment information is already entered.
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They're in buying mode.
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Suggest the next logical service.
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Identify common combinations.
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If someone buys shoes, they likely need socks.
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For home services, add optional line items to every quote.
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If they request weeding, include bark mulch installation.
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We know their flower beds need help.
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Weeding and mulching complement each other.
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Follow up on abandoned carts.
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Online retails do a great job of this.
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You get messages if you put items into your cart but never purchase them.
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For home service businesses, declined line items and pending quotes are the equivalent of abandoned carts in retail.
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It is possible that you misinterpreted what the customer wanted.
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It is possible they wanted to spend more.
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This happened to me once.
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I quoted $2,000 to $3,000 to extend a flower bed.
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Weeks later, I drove by and saw my competitor installing a massive retaining wall.
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I asked about his bid, $24,000 including a paver patio.
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The customer didn't want extended edging.
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She wanted a new design.
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I undersold her.
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I was thinking small.
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I never cross-sold her from the $2,000 edging into a $24,000 project.
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In Copay at CRM, we ask every declined estimate why they did not accept.
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This gives us a second chance at closing the deal.
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At the very least, we get information about why estimates are declined.
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I need to know if price was the only concern.
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I need to know if I didn't give them the options they wanted.
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I need to know if there was a scheduling problem.
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I never wanted to lose out on a $24,000 job because I thought the customer was price sensitive.
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People believe they can achieve complete automation of upselling and cross-selling.
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You can and should use automated texts and emails.
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We send out thousands every day from Copi at CRM.
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But personalized recommendations are worth the extra effort.
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Think about the experience of being with a well-trained apparel salesperson.
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They tailor the products they offer to your needs.
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An amazing waiter or waitress can also suggest menu items that match your tastes.
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we are willing to spend more money with these types of salespeople.
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It's ironic.
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In home services, we'll knock on strangers' doors for new business.
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But we hold back when it comes to offering more services to customers who already trust us.
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We spend thousands on billboards seen by strangers.
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We paint our trucks to attract new customers.
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Yet, we hesitate to make follow-up calls to customers with pending estimates.
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We're reluctant to contact existing customers about promotions or money-saving service combinations.
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We don't text customers who declined estimates to learn why.
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When the economy tightens, and it will, there will be fewer leads.
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Customers will become more price-sensitive and get many quotes.
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Business owners unwilling to follow up will lose out to those who do.
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Here's a tip.
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Don't send texts only.
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Send iMessages.
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The blue bubble tells customers you're sending a personal message, not an automated one.
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This is what Gary Vaynerchuk calls scaling the unscalable.
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A personalized recommendation is far more effective than a mass message.
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Hey, this is on sale!
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Versus, Mr. Jones, I think the service would be perfect for your property.
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I noticed that it was needed last week when I was on site.
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Think about this.
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Sending personalized messages takes five minutes each, so you can send 12 in one hour.
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If one person responds and becomes a customer with a $5,000 lifetime value, isn't that hour well spent?
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Is five minutes worth $5,000 in lifetime profit?
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Absolutely.
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Here's a radical idea.
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What if you spent $0 on marketing next year?
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Focus on cross-selling to all your customers, existing, new, old, and even unhappy ones.
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Amazon excels at this.
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They fill most of their product pages with upsells and cross-sells.
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When I shop, they offer instant checkout for convenience.
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They upsell me to business prime.
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They cross-sell faster delivery.
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They recommend subscription plans.
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Further down, I see frequently bought together, bundles, and similar items to consider.
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One page contains dozens of cross-selling opportunities.
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Cure 3 of adding adjacent services comes with a big warning.
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Be careful.
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Adding services and expanding your service area may seem like easy ways to boost revenue, but they are often the least profitable growth strategies.
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Only add an adjacent service if it has an opposite demand curve from your primary service.
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At Augusta, we offer snow removal because when snow covers the ground, demand for lawn care disappears.
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The demand curves work in opposite ways.
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Lawn care is busiest in spring and fall, but slows down in winter.
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In contrast, snow removal is most needed when lawn care is at its lowest demand.
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Review your cross-sell tree on page 14 of the workbook.
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Mark an X next to services with the same demand curve as your primary service.
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Identify adjacent services that will fill your off-season gap with opposite demand patterns.
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Only add services to your business to fix seasonitis and drops in revenue.
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Do not add more services to inflate revenue during your busy season.
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On page 16 of the workbook, list two adjacent services you can offer to current customers.
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You should not need new trucks or equipment.
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draw their demand curves, and compare them to your current revenue pattern.
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The main goal isn't to boost revenue.
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It's to fix the Q4 collapse with services that thrive when your core service lead flow slows down.
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Finally, determine where in the customer lifecycle you'll promote these adjacent services.
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Will you cross-sell after completing your core service, during the buying process, via text, email, or in person?
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Develop a plan to promote these adjacent services to your existing database.
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How will you promote your adjacent service without spending on advertising?
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00:26:33.669 --> 00:26:37.853
Consider sending targeted text and emails through your CRM system.
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Send this notice to all your business contacts.
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These people have demonstrated a need for your service in the past.
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Share a post about the adjacent service on your social media accounts.
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But don't stop there.
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00:26:50.824 --> 00:26:55.628
For the highest conversion rates, consider making personal calls to your customer base.
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If you close 10 to 20% on this new service, the time you invest will pay off big.
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Practice your script now.
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How will you talk to an existing customer about this adjacent service?
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What would you say to emphasize the value and connection to the work you have already done for them?
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Remember, these customers already trust you.
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They've experienced your quality work firsthand.
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They're more likely to try your new adjacent service than strangers.
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Plus, it costs nothing to reach them.
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Chapter 5, Adjacent Services The crisp morning sun beat down on the white snow as I pulled up to Kathy's lawn and landscape in Ohio.
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Josh Kathy stood out front, pacing with a weary expression, his eyes tired yet welcoming.
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He was fresh off a 17-hour shift, plowing snow, insulting driveways.
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At first glance, his operation looked like it should be thriving.
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He was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was a man who was
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over $700,000 in revenue last year.
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Four trucks, a solid client base of big contracts.
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But within minutes, the real picture began to surface.
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And it wasn't pretty.
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An unexpected situation had blindsided Josh.
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Last year, his brother helped manage the business.
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But he stole work and equipment from the company while keeping it hidden from Josh.
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Josh hadn't seen the signs until it was too late.
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The books were a mess.
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There was no way to track expenses.
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Employees who got too close to the truth were mysteriously fired by his brother.
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There was betrayal, confusion, and loss.
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Unused and broken mowers littered the dimly lit shop space.
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By the time I got there, the fallout was staggering.
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His financial statements said he made $150,000 in profit the year before.
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But Josh had three bank accounts, all negative.
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Overdraft fees piled up daily.
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He was behind on his personal mortgage, behind on his car payments.
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He buried himself somewhere between $400,000 to $500,000 in debt and didn't know the exact number.
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His website didn't work.
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It had a security error that blocked people from accessing it.
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Someone misspelled the business name on his Google listing.
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He had zero Google reviews.
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Third-party lead agencies outranked his website online.
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His brand had no digital presence.
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When I tried to look him up, I couldn't find him.
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But the financial mess wasn't the only issue.
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Only two of his employees had driver's licenses.
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Most were unprofessional, short-term hires.
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Some didn't speak English.
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Some were working without legal authorization.
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Josh's ex-wife was getting paid cash to work for the business.
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In the past, Josh had fired her.
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She was dragging the culture of the team down.
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The only reason Josh kept her was that she had a driver's license and could transport the crews around.
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Each morning, he picked up employees from their homes.
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He drove them to job sites and balanced his schedule to keep things running smoothly.
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Those same employees complained about low pay and were inconsistent with attendance.
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Josh was being pulled under by the weight of low margin work.
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Massive commercial mowing contracts looked good on paper, but were paying about $30 to $40 an hour.
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They needed a lot of crew coordination.
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This caused frequent callbacks and made Josh depend on cheap, unreliable workers.
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He was also trying to grow the business.
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He was thinking about adding services like tree removal, chipper work, and hydro seating.
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But he was already swamped with mowing and landscaping jobs during the spring rush.
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The problem wasn't that Josh wasn't working hard.
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It's that he was working hard on the wrong things.
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He had no margin to breathe, no way to get ahead, and no clarity on where the business was bleeding out.
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We fixed the basics first.
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Longcare Web Design rebuilt his website from the ground up.
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In six weeks, Josh went from zero Google reviews to over 40.
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Customers could finally find him, and they liked what they saw.
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The real breakthrough came when we separated the profitable from the painful.
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Mowing wasn't working.
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It was low margin and had the same seasonal demand curve as landscaping.
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So we offloaded it.
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Josh began subcontracting all his commercial mowing contracts to cheaper local providers.
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Instead of making $35 an hour doing the work himself, he could make 15% to 20% margins without touching a blade of grass.
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This let him focus on his strengths.
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Project work like landscaping, hardscaping, and design installs.
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Jobs that paid $70 to $90 an hour, with fewer callbacks, with real profit.
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With crews, he could pay more.
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The labor pool he could hire from changed.
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He didn't need to keep hiring under-the-table workers to survive.
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He could attract legal laborers and pay them well.
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Then we doubled down on snow service jobs.
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Josh already had snow contracts.
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They were profitable.
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But he never capitalized on them.
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None of his crew could drive the trucks.
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We flipped that script.
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He held onto the snow removal parts of the commercial jobs and subcontracted out the mowing.
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This changed his year.
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Now, Winter was a huge profit driver, not a setback.
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He could go out and sell more snow contracts.
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Josh finally fired his ex-wife from the business.
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He didn't do it out of anger.
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He didn't need to rely on her being a driver anymore.
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He started hiring employees who were legal, professional, and had driver's licenses.
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He paid them more.
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They stayed longer.
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His customers were happier.
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His stress levels dropped.
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In six weeks, Kathy's lawn and landscape had turned a corner.
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Not because we had added more services.
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Not because we got more leads.
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We realigned the business to focus on high-margin services, snow, and landscape jobs.
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These services complement each other well and have opposite demand curves.
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This helped reduce seasonal chaos.
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This wasn't about working harder.
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It was about working smarter.
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It was about selling services that offset the demand curve of his core business.
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Landscaping and hardscaping in the summer.
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Snow removal in the winter.
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That's how you fight seasonality.
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After four weeks with the new website, Josh began receiving four to five landscaping estimates daily.
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Josh booked himself out for 26 weeks into the future with profitable project work.
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That's how Josh started to win again.
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He avoided low-profit margin mowing jobs.
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He sold snow as an adjacent service to his core landscape offerings.
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Tier 3 for Seasonitis is selling adjacent services.
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We looked into lockdown mode, which means shutting down in the off-season.
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Tier 1.
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We also focused on finding more and better jobs by advertising and upselling.
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Tier 2.
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Now, let's discuss how to sell services adjacent to your core business.
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This method is affected if your market faces severe weather changes in the off-season.
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These shifts can stop you from selling your main service.
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This was the case for Josh at Kathy's Lawn and Landscape.
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He couldn't do landscaping jobs when there was snow on the ground.
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Cure 3 is also ideal if you do not want to change your business name or brand identity.
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With the Ford F-150 example we used last chapter, upselling means upgrading from an XL to a Lariat model.
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Cross-selling means selling a trailer, bumper, or kayak rack with that truck.
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This approach appears everywhere in consumer experiences.
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When you book flights on Expedia, you'll see car rentals and hotel options at checkout.
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These have nothing to do with flying, but complement the trip.
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The fundamental idea of cross-selling is saying, you know that thing you bought?
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You might like to buy this too.
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Amazon excels at the strategy on their product pages.
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More on that soon.
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In your workbook, on page 14, we'll examine the cross-sell tree.
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But first, let's consider the upsell service funnel.
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Mowing is the top of the lawn care funnel.
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It's affordable and most customers need it.
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From there, upsell them to a property cleanup, then to recurring bed maintenance.
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Then I sell them chemical applications.
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The highest value lawn care customer receives full service maintenance.
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I sell them year-round service for all their outdoor needs.
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That's the upsell service funnel.
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As discussed in Cure 2, I am selling a better version of the original service.
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Now, let's examine the cross-cell tree.
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I provide waste removal, snow removal, and top dressing with overseeding for my mowing customers.
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They perform these services on the same property with similar equipment.
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Property cleanup customers might need pressure washing, storm debris removal, or gutter cleanouts.
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Bed maintenance clients would enjoy drip irrigation, mulch insulation, or weed barriers.
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Chemical application customers might want mosquito control, soil testing, or organic options.
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Adjacent services don't need large investments in new equipment, trucks, or branding.
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You use what you already have.
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There is no extra liability insurance or major new expenses.
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For the sake of an example, here are some pricing assumptions for a landscaping business.
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Let's say the mowing service is $50 a cut, weeding service is $30 per service, bush trimming is $300 per service, snow service is $80 per push, and moults installation is $900 per service.
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Let's calculate the financial impact of cross-selling.
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If I charge $50 per mowing, 30 times per year, and cross-sell 8 snow removal visits, I could boost revenue by 42%, from $1,500 to $2,140 each year.
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Cross-selling bush trimming 3 times per year to mowing customers increases annual revenue by 60%.
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Cross-selling snow removal and mulch insulation boosts revenue by 103%.
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This means my income doubles without any marketing costs.
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Question is, do we have a leads problem or a cross-sell problem?
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Do we lack enough offers to increase customer lifetime value?
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On page 14 of your workbook, list three cross-sell opportunities to each service in your upsell funnel.
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You can grow a business in three ways.
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I name it Aura, O-R-A, onboard, retain, ascend.
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You can onboard more customers through marketing.
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You can retain customers and raise prices over time.
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You can ascend customers by increasing their value through cross-selling.
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Home service businesses prioritize onboarding, getting new customers.
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We place some emphasis on retention, but we often neglect ascending customers into higher-ticket, higher-margin services.
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This is where the real profit lies.
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Worried about seeming too salesy?
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Remember this.
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Ford's biggest fans don't buy the cheapest models.
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They drive vehicles with all the bells and whistles.
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They upgrade to the Lariat and King Ranch editions.
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These customers stay with Ford for life.
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Their churn rate is nearly zero.
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They never leave the brand.
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These loyal customers also cross-sell themselves into light bars, custom suspensions, special tires, and other modifications.
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They customize.
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They buy more adjacent products and services.
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Your most loyal customers give you more money.
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Once you realize this, cross-selling doesn't feel pushy.
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If you cross-sell and get more money from customers, they're less likely to leave.
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They become your biggest fans.
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They leave great reviews because you solve more of their problems.
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Solving more of your customers' problems will make it less likely that they will go to a competitor.
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There is more risk for them to leave if you perform more than one service.
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Make your service stickier.
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Solve more problems and offer more services to your customers.
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Let me share a case study with a massive impact.
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This business had 200 recurring customers with an annual turn of 50%.
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Every year, they were losing half of their customers.
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Their annual customer value was $1,000.
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Multiply that by 200 recurring customers and you get $200,000 in annual value.
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Cross-selling snow removal and organic lawn care boosted their annual customer value to $2,400.
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The company went from $200,000 to $480,000 in revenue the next year.
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They didn't run advertising campaigns.
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They kept the same number of customers.
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They more than doubled revenue by increasing annual customer value from $1,000 to $2,400.
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Here's what's remarkable.
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The average customer lifespan went from two years to three years.
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That means annual churn dropped from 50% to 30%,
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The company didn't change its service quality or training.
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They provided the exact same service.
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Customers who bought snow removal and organic lawn care were less likely to leave.
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It's harder to leave once you've purchased more services from a company.
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Same as Ford.
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It's harder to leave the brand once you've bought its best truck and modified it to your liking.
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We increased annual value from $1,000 to $2,400.
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We reduced churn from 50% to 33%.
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Lifetime value for this business went from $2,000 to $7,200, more than tripling.
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The combination created a massive impact.
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How?
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We added one more service.
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We solved another problem for the customer.
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What if you don't have a retention problem?
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What if you have an ascension problem?
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We often think customers leave because of poor service.
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In reality, we're not selling them enough adjacent services.
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We don't solve enough of their problems, making it easy for them to switch to someone who will.
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When you triple lifetime value, you can afford to spend much more on customer acquisition.
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Customers become much more valuable.
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After meeting with Dr. Cashy and Alex Formozzi in Vegas, I created a cross-sell tree.
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I found that snow services increased demand during our mowing off-season.
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That became Augusta Lawn Care's adjacent service.
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It was perfect in some markets.
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Why?
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When the grass is growing, there is no snow.
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When there is snow on the ground, we can't mow.
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We sell snow surfaces using instant pricing on our website.
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Do you have a small, medium, or large driveway?
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Here's your price.
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Check out.
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Let's go.
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There are four different types of cross-selling.
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Write these down on page 15 of your workbook.
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First is bundling, offering a discounted package that includes multiple related services.
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For home services, you can offer priority scheduling instead of price discounts.
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For example, customers who buy both mowing and snow removal get first priority when it snows.
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Second, recommended products or add-ons.
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Relate to what the customer has already bought.
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If work is slow, look at declined estimates from this time last year.
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Recommend the exact same services they considered before.
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Many will accept with minimal effort.
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Consider when to propose extra services.
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Before the job, during lead collection, in meetings, or after providing estimates.
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You can recommend them on-site or after the job.
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Customer satisfaction is highest then.
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You complete the job.
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They're thrilled.
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You solve their problem.
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You have built trust.
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Offer them a solution to another problem they have.
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During the walkthrough, they're getting rave reviews.
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This is the perfect time to cross-sell another service.
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The final invoice is another opportunity to mention your next seasonal service.
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In all September and October invoices, I promote snow removal as a recommended add-on.
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Schedule post-job inspections for projects.
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When you arrive, they're still happy with your work.
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Make minor adjustments if needed, then cross-sell additional services.
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Third, another approach is using partners.
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Recommended products sold by partner companies for commission.
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For example, if you don't want to offer snow removal yourself, partner with a snow-only company.
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Sell their services to your customers to earn affiliate commissions.
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The fourth type of cross-sell is seasonal cross-selling.
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It works great for seasonal businesses.
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Send mass emails or texts to customers right before leaf season or as snow is about to fall.
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Click here to get on our snow route.
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Our goal is to avoid the business contracting seasonitis.
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We want to avoid off-seasons and fluctuations in revenue.
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But I would be crazy to think that demand is not seasonal.
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To address this, we must have season-specific offers for season-specific services.
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Create a seasonal offer for every season of the year.
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On page 14 of the workbook, match a service from your cross-sell tree with every month of the year.
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Some services might get promoted across multiple months.
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For mowing, I target March through May.
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But for the other nine months, I need different cross-sell opportunities.
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Leaf cleanups in October and November.
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Snow removal in December and February.
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And Christmas lights in November and December.
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What if Augusta Lawn Care was actually called Augusta Snow Services?
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We'd mow for seven to eight months.
276
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Then as snow season arrived, we'd get busy.
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00:17:18.741 --> 00:17:21.541
This wouldn't be a time to relax or lay off employees.
278
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We'd run ads, hire more staff, get more trucks, and prepare for the snow season.
279
00:17:27.522 --> 00:17:30.364
Do we have a leads problem or an offer problem?
280
00:17:31.345 --> 00:17:34.928
Often, we lack enough services to stay busy year-round.
281
00:17:35.609 --> 00:17:40.033
Create more offers for each season, every quarter, every month.
282
00:17:40.673 --> 00:17:43.295
Give your team resources to execute cross-sells.
283
00:17:43.876 --> 00:17:46.318
Provide sales training to your phone answering team.
284
00:17:47.151 --> 00:17:49.755
Turn customer service calls into cross-sell opportunities.
285
00:17:50.355 --> 00:17:55.762
When someone complains about grass clippings in flowerbeds, offer bed maintenance services.
286
00:17:56.343 --> 00:18:00.429
If someone complains about a patchy lawn, offer top dressing and overseeding.
287
00:18:01.360 --> 00:18:04.101
Give your team product knowledge and sales materials.
288
00:18:04.721 --> 00:18:07.002
We give all frontline team members business cards.
289
00:18:07.443 --> 00:18:10.124
It costs $8 to get 100 of them printed off.
290
00:18:10.804 --> 00:18:14.005
Train your crew to identify specific customer needs.
291
00:18:14.706 --> 00:18:19.288
Teach them to notice overflowing gutters, weedy beds, and other cross-sell opportunities.
292
00:18:20.250 --> 00:18:24.331
Finally, share customer data and pricing information with your team.
293
00:18:24.971 --> 00:18:27.832
Some owners worry employees might steal this information.
294
00:18:28.452 --> 00:18:28.812
They might.
295
00:18:29.332 --> 00:18:33.833
But without it, they can never effectively upsell or cross-sell for you.
296
00:18:34.513 --> 00:18:37.114
We provide our crews with instant pricing door hangers.
297
00:18:37.614 --> 00:18:39.155
We give the technicians business cards.
298
00:18:39.675 --> 00:18:44.696
When they see opportunities to cross-sell, they write down the prices and share them with customers.
299
00:18:45.336 --> 00:18:53.060
Hiding information from your team might seem like protecting your business, but it actually stops cross-sell opportunities.
300
00:18:53.660 --> 00:18:57.902
You're blocking your crew from improving customer lifetime value on your behalf.
301
00:18:58.919 --> 00:19:04.101
Use software to encourage your team to recommend products based on what customers have bought before.
302
00:19:04.681 --> 00:19:10.224
If a customer buys fall cleanups each year, offer them spring cleanups or regular weeding services.
303
00:19:10.924 --> 00:19:12.845
Sell them on a recurring maintenance plan.
304
00:19:13.605 --> 00:19:19.947
In a test with Copilot CRM, we found that turning on the cross-sell feature boosted average revenue by 29%.
305
00:19:21.668 --> 00:19:28.291
This feature allows employees to send text messages or emails to customers about extra services while they are on site.
306
00:19:28.711 --> 00:19:31.392
Make it seamless for your crew to sell more services.
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Incentivize them and watch your business grow.
308
00:19:35.314 --> 00:19:39.175
Let's examine some cross-selling techniques from online retail stores.
309
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They excel at this.
310
00:19:41.336 --> 00:19:44.757
First is the price drop alert, a time-bound discount.
311
00:19:45.458 --> 00:19:48.179
This weekend only, buy one t-shirt, get one free.
312
00:19:49.079 --> 00:19:51.442
For home services, send a mass text.
313
00:19:51.843 --> 00:19:53.404
We're accepting new snow customers.
314
00:19:53.485 --> 00:19:56.588
For the next 24 hours, get your first visit 50% off.
315
00:19:57.429 --> 00:20:00.293
Post-purchase recommendations work well in retail.
316
00:20:00.874 --> 00:20:05.499
After you buy a suit, the store sends you recommended ties that match the outfit.
317
00:20:06.100 --> 00:20:12.203
For home services, after customers accept an estimate, the thank you page can suggest extra services.
318
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They have said yes to your proposal.
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Their payment information is already entered.
320
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They're in buying mode.
321
00:20:19.085 --> 00:20:21.286
Suggest the next logical service.
322
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Identify common combinations.
323
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If someone buys shoes, they likely need socks.
324
00:20:27.789 --> 00:20:31.370
For home services, add optional line items to every quote.
325
00:20:31.931 --> 00:20:35.052
If they request weeding, include bark mulch installation.
326
00:20:35.766 --> 00:20:37.226
We know their flower beds need help.
327
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Weeding and mulching complement each other.
328
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Follow up on abandoned carts.
329
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Online retails do a great job of this.
330
00:20:46.008 --> 00:20:49.748
You get messages if you put items into your cart but never purchase them.
331
00:20:50.609 --> 00:20:56.910
For home service businesses, declined line items and pending quotes are the equivalent of abandoned carts in retail.
332
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It is possible that you misinterpreted what the customer wanted.
333
00:21:01.351 --> 00:21:03.691
It is possible they wanted to spend more.
334
00:21:04.315 --> 00:21:05.255
This happened to me once.
335
00:21:05.796 --> 00:21:09.017
I quoted $2,000 to $3,000 to extend a flower bed.
336
00:21:09.557 --> 00:21:13.919
Weeks later, I drove by and saw my competitor installing a massive retaining wall.
337
00:21:14.599 --> 00:21:19.201
I asked about his bid, $24,000 including a paver patio.
338
00:21:19.781 --> 00:21:21.962
The customer didn't want extended edging.
339
00:21:22.382 --> 00:21:23.583
She wanted a new design.
340
00:21:24.283 --> 00:21:25.784
I undersold her.
341
00:21:25.804 --> 00:21:26.864
I was thinking small.
342
00:21:27.324 --> 00:21:30.986
I never cross-sold her from the $2,000 edging into a $24,000 project.
343
00:21:33.782 --> 00:21:38.244
In Copay at CRM, we ask every declined estimate why they did not accept.
344
00:21:38.865 --> 00:21:41.206
This gives us a second chance at closing the deal.
345
00:21:41.746 --> 00:21:45.288
At the very least, we get information about why estimates are declined.
346
00:21:45.929 --> 00:21:48.310
I need to know if price was the only concern.
347
00:21:48.810 --> 00:21:52.112
I need to know if I didn't give them the options they wanted.
348
00:21:52.712 --> 00:21:54.773
I need to know if there was a scheduling problem.
349
00:21:55.314 --> 00:22:00.997
I never wanted to lose out on a $24,000 job because I thought the customer was price sensitive.
350
00:22:01.971 --> 00:22:06.392
People believe they can achieve complete automation of upselling and cross-selling.
351
00:22:07.072 --> 00:22:10.013
You can and should use automated texts and emails.
352
00:22:10.533 --> 00:22:13.334
We send out thousands every day from Copi at CRM.
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00:22:14.054 --> 00:22:16.955
But personalized recommendations are worth the extra effort.
354
00:22:17.615 --> 00:22:21.437
Think about the experience of being with a well-trained apparel salesperson.
355
00:22:21.917 --> 00:22:24.277
They tailor the products they offer to your needs.
356
00:22:24.918 --> 00:22:29.399
An amazing waiter or waitress can also suggest menu items that match your tastes.
357
00:22:29.959 --> 00:22:33.321
we are willing to spend more money with these types of salespeople.
358
00:22:33.842 --> 00:22:34.402
It's ironic.
359
00:22:34.822 --> 00:22:38.185
In home services, we'll knock on strangers' doors for new business.
360
00:22:38.605 --> 00:22:44.009
But we hold back when it comes to offering more services to customers who already trust us.
361
00:22:44.469 --> 00:22:47.411
We spend thousands on billboards seen by strangers.
362
00:22:47.711 --> 00:22:49.753
We paint our trucks to attract new customers.
363
00:22:50.173 --> 00:22:54.536
Yet, we hesitate to make follow-up calls to customers with pending estimates.
364
00:22:54.996 --> 00:23:00.758
We're reluctant to contact existing customers about promotions or money-saving service combinations.
365
00:23:01.179 --> 00:23:04.380
We don't text customers who declined estimates to learn why.
366
00:23:04.860 --> 00:23:08.322
When the economy tightens, and it will, there will be fewer leads.
367
00:23:09.022 --> 00:23:12.663
Customers will become more price-sensitive and get many quotes.
368
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Business owners unwilling to follow up will lose out to those who do.
369
00:23:17.565 --> 00:23:18.085
Here's a tip.
370
00:23:18.686 --> 00:23:19.846
Don't send texts only.
371
00:23:20.166 --> 00:23:21.127
Send iMessages.
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00:23:21.907 --> 00:23:26.190
The blue bubble tells customers you're sending a personal message, not an automated one.
373
00:23:26.951 --> 00:23:30.073
This is what Gary Vaynerchuk calls scaling the unscalable.
374
00:23:30.653 --> 00:23:33.816
A personalized recommendation is far more effective than a mass message.
375
00:23:34.216 --> 00:23:35.357
Hey, this is on sale!
376
00:23:35.817 --> 00:23:39.399
Versus, Mr. Jones, I think the service would be perfect for your property.
377
00:23:39.840 --> 00:23:42.362
I noticed that it was needed last week when I was on site.
378
00:23:43.255 --> 00:23:43.935
Think about this.
379
00:23:44.636 --> 00:23:49.579
Sending personalized messages takes five minutes each, so you can send 12 in one hour.
380
00:23:50.059 --> 00:23:56.983
If one person responds and becomes a customer with a $5,000 lifetime value, isn't that hour well spent?
381
00:23:57.503 --> 00:24:01.005
Is five minutes worth $5,000 in lifetime profit?
382
00:24:01.506 --> 00:24:02.146
Absolutely.
383
00:24:02.706 --> 00:24:03.687
Here's a radical idea.
384
00:24:04.147 --> 00:24:06.749
What if you spent $0 on marketing next year?
385
00:24:07.507 --> 00:24:13.449
Focus on cross-selling to all your customers, existing, new, old, and even unhappy ones.
386
00:24:14.269 --> 00:24:15.429
Amazon excels at this.
387
00:24:15.989 --> 00:24:19.490
They fill most of their product pages with upsells and cross-sells.
388
00:24:20.110 --> 00:24:23.071
When I shop, they offer instant checkout for convenience.
389
00:24:23.511 --> 00:24:25.292
They upsell me to business prime.
390
00:24:25.652 --> 00:24:27.492
They cross-sell faster delivery.
391
00:24:27.772 --> 00:24:29.293
They recommend subscription plans.
392
00:24:29.853 --> 00:24:34.815
Further down, I see frequently bought together, bundles, and similar items to consider.
393
00:24:35.536 --> 00:24:38.657
One page contains dozens of cross-selling opportunities.
394
00:24:39.098 --> 00:24:43.019
Cure 3 of adding adjacent services comes with a big warning.
395
00:24:43.720 --> 00:24:44.600
Be careful.
396
00:24:45.581 --> 00:24:53.965
Adding services and expanding your service area may seem like easy ways to boost revenue, but they are often the least profitable growth strategies.
397
00:24:54.825 --> 00:25:00.169
Only add an adjacent service if it has an opposite demand curve from your primary service.
398
00:25:00.930 --> 00:25:07.134
At Augusta, we offer snow removal because when snow covers the ground, demand for lawn care disappears.
399
00:25:07.775 --> 00:25:09.977
The demand curves work in opposite ways.
400
00:25:10.697 --> 00:25:14.259
Lawn care is busiest in spring and fall, but slows down in winter.
401
00:25:14.859 --> 00:25:20.022
In contrast, snow removal is most needed when lawn care is at its lowest demand.
402
00:25:20.783 --> 00:25:23.624
Review your cross-sell tree on page 14 of the workbook.
403
00:25:24.245 --> 00:25:29.268
Mark an X next to services with the same demand curve as your primary service.
404
00:25:30.068 --> 00:25:36.190
Identify adjacent services that will fill your off-season gap with opposite demand patterns.
405
00:25:37.010 --> 00:25:41.711
Only add services to your business to fix seasonitis and drops in revenue.
406
00:25:42.271 --> 00:25:46.913
Do not add more services to inflate revenue during your busy season.
407
00:25:47.473 --> 00:25:53.154
On page 16 of the workbook, list two adjacent services you can offer to current customers.
408
00:25:53.914 --> 00:25:55.755
You should not need new trucks or equipment.
409
00:25:56.577 --> 00:26:00.459
draw their demand curves, and compare them to your current revenue pattern.
410
00:26:01.199 --> 00:26:03.080
The main goal isn't to boost revenue.
411
00:26:03.640 --> 00:26:10.163
It's to fix the Q4 collapse with services that thrive when your core service lead flow slows down.
412
00:26:10.863 --> 00:26:16.105
Finally, determine where in the customer lifecycle you'll promote these adjacent services.
413
00:26:16.705 --> 00:26:23.108
Will you cross-sell after completing your core service, during the buying process, via text, email, or in person?
414
00:26:23.799 --> 00:26:28.544
Develop a plan to promote these adjacent services to your existing database.
415
00:26:29.224 --> 00:26:33.248
How will you promote your adjacent service without spending on advertising?
416
00:26:33.669 --> 00:26:37.853
Consider sending targeted text and emails through your CRM system.
417
00:26:38.474 --> 00:26:40.816
Send this notice to all your business contacts.
418
00:26:41.478 --> 00:26:44.340
These people have demonstrated a need for your service in the past.
419
00:26:44.980 --> 00:26:48.843
Share a post about the adjacent service on your social media accounts.
420
00:26:49.403 --> 00:26:50.264
But don't stop there.
421
00:26:50.824 --> 00:26:55.628
For the highest conversion rates, consider making personal calls to your customer base.
422
00:26:56.328 --> 00:27:01.512
If you close 10 to 20% on this new service, the time you invest will pay off big.
423
00:27:02.190 --> 00:27:03.312
Practice your script now.
424
00:27:03.873 --> 00:27:07.238
How will you talk to an existing customer about this adjacent service?
425
00:27:07.799 --> 00:27:12.365
What would you say to emphasize the value and connection to the work you have already done for them?
426
00:27:13.026 --> 00:27:15.350
Remember, these customers already trust you.
427
00:27:15.931 --> 00:27:18.535
They've experienced your quality work firsthand.
428
00:27:19.095 --> 00:27:22.360
They're more likely to try your new adjacent service than strangers.
429
00:27:22.721 --> 00:27:24.824
Plus, it costs nothing to reach them.
